January 29, 2018 / 1:51 PM / 8 months ago

First Abu Dhabi Bank's 2017 profit crimped by merger costs

DUBAI, Jan 29 (Reuters) - First Abu Dhabi Bank (FAB), the largest bank in the United Arab Emirates, on Monday reported a 3.5 percent profit fall in 2017, citing costs linked to its recent merger.

FAB, the combination of National Bank of Abu Dhabi and First Gulf Bank, said its full-year net profit was 10.92 billion dirhams ($3 billion) compared to 11.32 billion dirhams in 2016.

Excluding integration costs and other merger-related expenses of around 601 million dirhams, adjusted net profit for the year was 11.52 billion dirhams while fourth-quarter profit was up 6 percent from the same period of last year, FAB said.

FAB’s board of directors recommended a cash dividend of 0.70 dirhams per share, which it said was the highest combined dividend distributed by the two banks, up 11 percent from 2016.

It said it had achieved around 500 million dirhams of cost synergies in the first year of integration, adding that it was evaluating its local activities and branch network.

“Regionally, we are working on expanding our presence to Saudi Arabia which forms part of FAB’s long-term strategy,” group chief executive Abdulhamid Saeed said.

Regional and international banks are eyeing opportunities to expand in Saudi Arabia, the largest economy in the Gulf, as the government pushes through reforms to cut the country’s dependence on oil revenue. ($1 = 3.6724 UAE dirham) (Reporting by Tom Arnold and Stanley Carvalho; editing by Alexander Smith)

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